Big tech companies have been in the spotlight over a number of their business practices. While the jury is still proverbially out on more regulation for big tech, one judge recently threw out a lawsuit against
Facebook (FB).
The lawsuit was an FTC complaint regarding a number of antitrust complaints, given the company’s anti-competitive nature. Shares of the social media firm rallied on the news, allowing the firm to hit a $1 trillion market cap for the first time.
There’s likely room to run from here. The company’s dominance of social media makes it an advertising powerhouse, with strong revenue growth and a fat 36 percent profit margin.
While any big tech regulation may end up breaking up the company into a number of potential firms, today’s buyers can play the overall tech firms’ growth in the meantime.
Action to take: Shares are still attractive near all-time highs, given the company’s 93 percent earnings growth and 48 percent revenue growth. For that kind of growth, shares are somewhat inexpensive at less than 29 times forward earnings.
The November $400 calls, going for about $11.00, after a slight selloff Tuesday offer a leveraged return to further upside in shares. They also stand a good chance of moving in-the-money well before expiration. Traders can likely nab high double-digit returns well before the option expires.
Disclosure: The author of this article has no position in the company mentioned here, but may make a trade after the next 72 hours. The author receives no compensation from any of the companies mentioned in this article.